Transport for London (TfL) has confirmed that from 2 January 2026, electric vehicles (EVs) will no longer be fully exempt from the Congestion Charge in central London.
The change introduces a tiered discount structure that will directly affect fleet operating costs and total cost of ownership models used by motor finance providers.
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Under the revised scheme, electric cars registered with TfL’s Auto Pay system will receive a 25% discount, resulting in a daily charge of £13.50. Electric vans, HGVs and quadricycles will benefit from a 50% discount, paying £9 per day. These rates compare to the standard £18 charge for other vehicles, which itself rises from the current £15. Vehicles not registered with Auto Pay will be charged the full rate.
The current 100% Cleaner Vehicle Discount ends on 25 December 2025. TfL stated the changes are necessary to ensure the Congestion Charge “continues to help manage traffic and congestion” in the capital. Further reductions are planned from 4 March 2030, when the discount for electric cars will fall to 12.5%, while vans and HGVs will retain the 25% rate.
Fleet operators with regular access to the charging zone will face new recurring costs, prompting potential changes in routing, scheduling, and vehicle allocation. For motor finance providers, the revised charges alter total cost of ownership assumptions, potentially impacting lease pricing, residual value forecasts, and customer propositions.
The requirement for Auto Pay registration to access discounted rates introduces additional administrative considerations. Finance providers may need to support clients in ensuring vehicles are correctly registered to avoid unexpected charges. TfL estimates that EVs will account for nearly 20% of vehicles in the zone by the end of 2025, underscoring the scale of the policy’s impact on commercial fleets.
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By GlobalDataAA president Edmund King criticised the move, calling it “a backward step” and arguing that incentives are still needed to support the transition to electric vehicles. Mayor Sadiq Khan defended the policy, stating it was essential to keep the scheme “fit for purpose” and citing projections of 2,200 additional vehicles entering the zone on an average weekday without intervention.
